§-Accounting syllabus
WA · SCSA← Accounting
Accounting syllabus, dot point by dot point
Every dot point in the WA Accounting syllabus, with a focused answer for each. Click any dot point for a worked explainer, past exam questions and links to related points.
Unit 3: Financial Accounting
Module overview →How does a company record the issue of shares, the payment of dividends, and the appropriation of profit?
Record the issue of shares for cash, the declaration and payment of interim and final dividends, transfers to reserves, and prepare the equity section showing share capital and retained earnings
How does the accrual basis create accrued and prepaid items at balance day, and how are revenues and expenses adjusted to the correct period?
Record balance day adjustments for accrued expenses, prepaid expenses, accrued revenue and revenue received in advance, and explain how each adjustment affects profit and the balance sheet
How does a business account for customers who may not pay, using bad debts written off and an allowance for doubtful debts?
Distinguish bad debts from doubtful debts, write off a bad debt, create and adjust an allowance for doubtful debts, and present accounts receivable at net realisable value
How does the Conceptual Framework guide the preparation of useful financial reports for a reporting entity?
Explain the purpose of the Conceptual Framework, the objective of general purpose financial reports, the qualitative characteristics of useful information, and the definitions and recognition criteria for the five elements
How does the Conceptual Framework define the five elements of financial statements, and when is each one recognised in the accounts?
Define assets, liabilities, equity, income and expenses using the Conceptual Framework, apply the recognition criteria, and explain how the definitions drive whether an item appears in the financial statements
How is the cost of a non-current asset allocated over its useful life and what happens on disposal?
Calculate and record depreciation using the straight-line and reducing-balance methods, determine carrying amount, and record the disposal of a non-current asset including any profit or loss
How does a company appropriate its profit through dividends and reserves, and how do these movements flow through retained earnings?
Record interim and final dividends, declared dividends and transfers to and from reserves, and reconcile the opening and closing balances of retained earnings for a company
How are balance day adjustments processed and used to prepare a company's financial statements?
Process balance day adjustments for accruals, prepayments, depreciation, doubtful debts and stock, and prepare a classified Income Statement, Statement of Changes in Equity and Balance Sheet for a company
How is inventory valued using the first-in first-out method, and how does this determine cost of sales and closing inventory?
Apply the first-in first-out (FIFO) method under a perpetual system to value closing inventory and cost of sales, and value inventory at the lower of cost and net realisable value
What makes financial information useful, and how do the fundamental and enhancing qualitative characteristics shape a general purpose financial report?
Explain the fundamental qualitative characteristics of relevance and faithful representation and the enhancing characteristics of comparability, verifiability, timeliness and understandability, and apply them to judgements about financial information
How is a Statement of Cash Flows prepared, and what do its operating, investing and financing sections reveal about a company?
Prepare a Statement of Cash Flows classifying cash flows into operating, investing and financing activities, reconcile to the change in cash, and interpret what the statement reveals about the business
How does the Statement of Changes in Equity reconcile the opening and closing equity of a company across each component?
Prepare a Statement of Changes in Equity showing movements in share capital, retained earnings and reserves, reconciling opening and closing balances of total equity
Unit 4: Cost and Management Accounting
Module overview →How do the operating and financial budgets combine into a master budget that produces budgeted financial statements?
Explain how the sales, production, expense and cash budgets combine into a master budget, and prepare a budgeted Income Statement and budgeted Balance Sheet
How does a business prepare and use budgets to plan and control its operations and cash flow?
Explain the purpose and benefits of budgeting, prepare a cash budget showing receipts, payments and closing balance, and use budget variances and internal controls to monitor performance
How are costs classified and how does their behaviour affect management decisions?
Classify costs as direct or indirect, fixed or variable, and explain cost behaviour, relevant range, and the use of cost classification in pricing and decision-making
How can cost-volume-profit analysis identify the break-even point and the output needed for a target profit?
Calculate contribution margin, the break-even point in units and dollars, the margin of safety, and the sales needed to achieve a target profit, and explain the assumptions of CVP analysis
How does a business protect its cash and other assets through internal control, and why is cash the highest-risk asset?
Explain the purpose and principles of internal control, including separation of duties, authorisation and reconciliation, and apply them to safeguarding cash
What are the limitations of ratio analysis, and how should non-financial and ethical factors inform a financial decision?
Explain the limitations of ratio analysis, evaluate the role of non-financial and ethical factors in decision-making, and recommend a course of action using both financial and qualitative information
How do liquidity and gearing ratios measure whether a business can pay its short-term debts and how heavily it relies on borrowed funds?
Calculate and interpret the current ratio, quick ratio, debt to equity and equity ratio, and explain what they reveal about short-term solvency and financial stability
How do manufacturing costs flow through direct materials, direct labour and overhead to a cost of goods manufactured and then cost of sales?
Trace manufacturing costs through prime cost and conversion cost, calculate the cost of goods manufactured using work in process, and link it to cost of sales for a manufacturer
How do profitability and efficiency ratios measure how well a business generates profit and uses its assets?
Calculate and interpret gross profit margin, net profit margin, return on assets, return on equity, inventory turnover and accounts receivable turnover, and explain what each reveals
How do financial ratios help users assess the profitability, liquidity and stability of a business?
Calculate and interpret profitability, liquidity, efficiency and financial stability ratios, and evaluate business performance and its limitations using ratio analysis
How does variance analysis compare actual results with the budget, and what do favourable and unfavourable variances tell management?
Calculate budget variances for revenue and expenses, classify them as favourable or unfavourable, and explain how variance analysis supports control and decision-making